Samsung says chips to recover in 2024 after best quarterly profit this year

Samsung Electronics on Tuesday flagged a gradual recovery in demand in 2024 after reporting its highest quarterly profit so far this year, as the battered memory chip market began showing signs of a rebound from a severe downturn.

The proliferation of on-device artificial intelligence (AI) functions will increase appetite for DRAM chips in premium products in 2024, the world’s biggest memory chip and smartphone maker said in a statement.

Elevate Your Tech Prowess with High-Value Skill Courses

Offering College Course Website
IIM Kozhikode IIMK Advanced Data Science For Managers Visit
MIT MIT Technology Leadership and Innovation Visit
Northwestern University Kellogg Post Graduate Certificate in Product Management Visit

“PC and mobile demand is likely to benefit from the arrival of some replacement cycles for products” next year, it added.

The South Korean technology giant said operating profit reached 2.4 trillion won ($1.78 billion) in July-September. Revenue fell 12% to 67.4 trillion won.

Although profit fell 78% from 10.85 trillion won a year earlier, it was higher than the first quarter’s 640 billion won and second quarter’s 670 billion won.

Loss in the memory chip business shrank to 3.75 trillion won in the third quarter, versus a 4.36 trillion won loss in the second, as Samsung focused on more profitable advanced chips such as DRAM chips used in AI, while continuing to cut production of older chips.

Discover the stories of your interest

Manufacturers of smartphones and PCs grappling with weak consumer demand have gradually reduced chip inventories to levels low enough to resume purchases, signalling the end of an industry slump that began last year, analysts said. Reflecting improving demand, some memory chip prices rebounded toward the end of the third quarter, while in September, overall factory output in South Korea rose for a second consecutive month helped by increasing chip production.

Cross-town rival SK Hynix last week said an AI boom is driving demand in DRAM chips while the effects of memory chipmakers’ production cuts are starting to show as clients are placing new orders and chip prices are beginning to stabilise.

Samsung’s earnings followed an announcement about new custom chips from smartphone rival Apple, in a continuation of the trend among major players toward in-house chip development.


Samsung’s share price rose 0.7% in morning trade, versus a 0.1% rise in the benchmark index.

The stock has risen about 22% year-to-date as investors look forward to an expanding memory chip market rebound.

Samsung said on Tuesday it expects to spend a record 53.7 trillion won in capital expenditure this year, including 47.5 trillion won on chips, to prepare for mid-to-long term demand increase.

The mobile devices business booked a 3.3 trillion won operating profit, slightly higher than 3.24 trillion won last year. Samsung launched its premium foldable smartphones during the quarter, drumming up sales despite a sluggish overall smartphone market.

The third quarter is normally strong for Samsung’s mobile and display businesses given that is when it launches flagship smartphones, and demand for display panels from clients such as Apple rises before the debut of the latest iPhone.

($1 = 1,346.5000 won)

(Reporting by Joyce Lee and Heekyong Yang; Editing by Christopher Cushing)

Stay on top of technology and startup news that matters. Subscribe to our daily newsletter for the latest and must-read tech news, delivered straight to your inbox.


This website uses cookies. By continuing to use this site, you accept our use of cookies.